Rightmove records weakest month of October for asking price increases since 2008

This year saw the weakest month of October for house sellers’ asking price growth since the 2008 financial downturn, according to a property website.

Across Britain, the average new seller asking price increased by 0.5% (£1,950) month-on-month in October, to reach £368,231, Rightmove said.

Newly-advertised properties typically increase at this time of year, as the autumn selling market gets under way.

But the increase in October 2023 was the smallest average asking price rise for this time of year since 2008, and well below the average increase of 1.4% recorded in October over the past 20 years, the website said.

The number of sales being agreed is 17% below this time last year, it added.

Rightmove’s analysis indicates that starting too high with the asking price and reducing it later can negatively affect the chances of a sale.

Tim Bannister, Rightmove’s director of property science, said: “New seller asking prices have seen a rise, as they usually do at this time of year following the summer holiday season.

“While this year’s much more subdued rise indicates that some new sellers are gradually heeding their agents’ advice to price competitively, agents report that other sellers still need to adjust their expectations on the price that they are likely to achieve.”

He added: “Buyers are likely to be on the look-out for homes that they feel represent excellent value, and to attract one of these motivated buyers, sellers need to price right first time.

“If similar nearby properties for sale appear overpriced, serious sellers have an opportunity to stand out from the crowd with a more competitive price and attract immediate buyer interest that our research shows significantly increases the likelihood of finding a buyer.”

Mr Bannister said the mortgage market is “much more stable right now compared to three months ago, giving movers a little more assurance over the rate they are likely to be offered and therefore what they are likely to be able to afford.

“Those looking to secure a new home for the new year should apply for a mortgage in principle to work out what they could afford, and listen to local estate agents about what’s happening in their local housing market.”

Ben Hudson, managing director at estate agent Hudson Moody in York, North Yorkshire, said: “Being too optimistic with the asking price causes a double whammy for sellers – not only do they inevitably have to reduce the price of their home anyway, but they often put off potential buyers with too high an initial asking price and then struggle to recapture this attention when it’s reduced.

“Sellers who price realistically or even a little modestly, often find they are met with more than one buyer who is attracted by the good-value pricing, and then suddenly they have competition to buy the property, which typically results in a higher agreed price.

“It’s been a bit of a rollercoaster market this year but certainly right now confidence is returning and we’re heading back to more normal, cyclical patterns. If sellers price right, there are buyers out there for them.”

Ben Gee, founder at Berkshire-based estate agent Hat and Home said: “With a significant proportion of instructions seeing at least one reduction prior to sale, many buyers are adopting a ‘wait and see’ approach, which is creating inertia across all price ranges.

“Premium stock in excellent condition or in the most sought-after locations continues to get strong interest quickly, but the mass market of homes needs to offer ‘good value’ whilst buyers have more property to choose from and are more price-sensitive.”

The report was released as separate research from estate and lettings agent Hamptons indicated that, across Britain, the average rent for a newly-let property was 11.7% higher in September than a year earlier.

Hamptons put the average monthly rent on a newly-let property at £1,325.

Landlords have been facing their own rising costs as mortgage rates have increased.

Aneisha Beveridge, head of research at Hamptons, said: “A decade of cheap money and rising house prices encouraged many landlords to remortgage and extract cash out of their buy-to-let when remortgaging.”

She added: “Rising rates will reverse this flow of finance, pulling cash out of the economy and back into the housing market as investors look to pay down their debt instead.”

Hamptons’ index uses data from estate agents’ network Countrywide, which Hamptons is part of. It is based on thousands of homes let and managed by Countrywide each year. It is based on rents achieved rather than advertised rents.